“अर्थस्य मूलं राज्यम्”– चाणक्य नीति सूत्र (“The state’s welfare is rooted in good finance.” – Chanakya Sutras) A department of Uttar Pradesh government is playing an

“अर्थस्य मूलं राज्यम्”

चाणक्य नीति सूत्र

(“The state’s welfare is rooted in good finance.” – Chanakya Sutras) 

A department of Uttar Pradesh government is playing an important role in proving this formula of Chanakya policy; the name of this department is National Savings. This department is providing hassle-free self-employment to citizens of all ages, starting from twenty one years of age. Every month, self employed people are earning sufficient amount of money to run their families.

Small savings schemes of India offer lucrative interests and tax exemptions, inculcate the savings habit, build a substantial corpus for the future, and protect from economic anxiety and financial stress. Money from such savings plays a very important role in making financial stability in a state and daily life of citizens. According to the 

 of economic growth, the level of savings is an important factor in determining economic growth rates.

District savings offices of National Savings Department of Uttar Pradesh government have been providing self-employment to educated persons who have 10th grade passed certificate and aged 21 years; both males and females are getting easy and hassle-free self-employment in the form of savings agents in post offices of the districts. This department is ensuring women’s empowerment by providing an opportunity in nation building. There are two different types of agency systems: 1- Standardised Agency System (SAS) for fixed deposits schemes, and 2- Mahila Pradhan Kshetriya Bachat Yojna (MPKBY) for recurring deposit scheme. These savings agents work hard for maximum investment in post office small savings schemes. 

District savings offices appoint the small savings agents and issue new agencies, provide necessary papers and forms to agents, help to short out problems existing before agents and investors, cause awareness about savings schemes, launch campaigns in those areas where there is less investment in savings schemes, do renewal of savings agencies, and take action against agents who are not obeying department’s rules or if any complaint from investors. With the help of the District Magistrate and Chief Development Officer of the district, the district savings office of the district set the target of deposit in small savings schemes for every department for every financial year (April-March). 

Whenever anyone goes to the post office for investment purposes, the investor will find some people who say that they are savings agents and will help the investors in the investment process through their services. 

Pic: An agent Mr Mukesh Agrawal is explaining about savings schemes to investor in Nauhjhil subpostoffice (District Mathura, Uttar Pradesh, India)

 report, submitted in 2011, small savings schemes are agent-driven schemes and there were more than five lakh savings agents in different post offices in India in 2011.  

Agents act as the bridge between the millions of depositors and the post offices for day-to-day transactions and investment. They do motivate people to save, and indirectly assist in channelising such small savings to financial assets. In return these agents earn the commission paid out of the National Small Savings Fund. Agents get 0.5% in fixed deposit schemes and 4% in recurring deposit schemes. According to the India Budget, the 

 paid to the agents would be about Rs 3,871.38 crore in 2023-24.   

Savings agents make the investors aware about the small savings schemes, new  rules and regulations, take timely payments from investors and deposit the money in post office schemes, take care of all of the paperwork that acts as a deterrent for some people  to  access  formal  financial  services, and keep and maintain their records. 

The government in India offers a range of post office small savings schemes, which offer lucrative interests and tax exemptions. These schemes are not just secure, but also help in financing government expenditure. Interest rates for small saving schemes are announced by the Finance Ministry on a quarterly basis. 

Small savings schemes inculcate the savings habit among individuals. The amount deposited or invested in the savings schemes could be used by depositors or investors for their future personal needs.  

There are three categories of small saving schemes in post offices:

(a) Post office Deposits: Post Office Savings Account, Post Office Time Deposits (1,2,3 and 5 years), Post Office Recurring Deposits, and Post Office Monthly Account. 

(b) Savings Certificates: National Savings Certificate, Kisan Vikas Patra, and Mahila Samman Savings Certificate. 

(c) Social Security Schemes: Public Provident Fund, Senior Citizens Savings Scheme, and Sukanya Samriddhi Account. 

These small savings schemes are run primarily through the post offices, nationalised banks and identified private sector banks. These schemes are meant for the economic well-being of the citizens, senior citizens, and retired employees. 

The National Savings Schemes run through Post Offices. India has the largest Postal Network in the world with 154,965 Post Offices (as on 31.03.2017); about 89 percent of these post offices, 139,067, are in the rural areas. Post offices in India play a vital role in the rural areas as they provide banking facilities in the absence of banks in the rural areas. The Indian Postal Service, under the brand name India Post, is the most widely distributed post office system in the world. 

Small savings schemes have penetrated the farthest and isolated villages in Uttar Pradesh and India through the network of post offices, savings agents and district savings offices. According to available data, the 

 in small savings schemes have increased from Rs 108 crores in 1948-49 to Rs 280274.93 crores in 2019-20.  Collection under National Savings Schemes has been 

, an economist and a professor at the National Institute of Public Finance and Policy, savings by the household sector is the most prominent component of savings. The large financing needs of investment in infrastructure require long-term financial savings of households to increase and to be channelled for this need. Economists 

 exceeds that of advanced economies such as the U.K., U.S. and similarly placed economies like Brazil and South Africa.”  

Sufficient savings can break the vicious circle of poverty in under-developed and developing nations. Savings can increase their ability to build capital formation for the nation. This will result in higher economic growth and development. This is the reason why savings is commonly regarded as the primary source of economic growth. 

 of the total collection of small savings, in India, are drawn from the rural population; there is a huge potential of investment in rural areas towards domestic capital formation. 

If we really want small savings to help in the economic development of the nation, the Ministry of Finance (MoF), and state governments need to strengthen the district savings offices, small savings agents, and postal network for the next-generation modernization for a financially stronger India. District Savings Offices can act as a facilitator to meet this challenge. 

Note: My article originally published on wordpress at 

https://letsmakeworldforfuturedaily.wordpress.com/2023/04/21/government/

Hassle-free Self-employment In Uttar Pradesh, India

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